Book of the week: An attack on market-friendly reforms

Book review: DivideA provocative, yet unconvincing argument against free-market reforms in developing countries.

Dr Matthew Partridge
By
published
in Features

Divide:A Brief Guide to Global Inequality and its Solutions

by Jason HickelPublished by Penguin, £20(Buy at Amazon)

Most development economists agree that market-friendly reforms have rescued poor countries from poverty. Growth in developing countries has been so rapid that critics of globalisation now tend to focus on the negative effects on workers in developed countries. Jason Hickel thinks this jubilation is premature. He argues that poverty is increasing, that economic growth in developing countries was faster during periods of state intervention, and that market reforms are reducing growth.

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Hickel highlights some genuine problems, but these are lost within a blizzard of cherry-picked examples, creative interpretations of statistics and a one-sided approach to economic history that sees developing countries as helpless victims of Britain and the US. Indeed, the book goes so far as to absolve developing countries of any responsibility for their misfortunes.

Corruption is only discussed in terms of firms evading taxes (a problem that actually ends up disadvantaging developed countries more than emerging markets). Nor do you learn that a century of protectionism and state-directed development took countries like Argentina from one of the richest places in the world, to a middle-income country. This is certainly a provocative book, but its central argument is unconvincing.

Dr Matthew Partridge
Dr Matthew Partridge
Shares editor, MoneyWeek

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

Follow Matthew on Twitter: @DrMatthewPartri

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